INCOME TAXES (Tables)

12 Months Ended

Feb. 03, 2024

Schedule of Income (Loss) Before Taxes, Domestic and Foreign

The components of Income (loss) before provision (benefit) for income taxes were as follows:


	Fiscal Years Ended
	February 3, 2024		January 28, 2023		January 29, 2022
	(in thousands)
Domestic	$	(156,703)	$	(61,065)	$	198,173
Foreign	42,905		46,303		58,857
Total income (loss) before provision (benefit) for income taxes	$	(113,798)	$	(14,762)	$	257,030

Schedule of Components of Provision (Benefit) for Income Taxes

The components of the Company’s Provision (benefit) for income taxes consisted of the following:


	Fiscal Years Ended
	February 3, 2024			January 28, 2023			January 29, 2022

	(in thousands)
Current:
Federal	$	(1,239)		$	4,172		$	29,406
State and local	249			(1,193)			7,389
Foreign	4,758			(2,842)			7,218
	3,768			137			44,013
Deferred:
Federal	21,125			(12,030)			14,517
State and local	13,019			(2,712)			8,780
Foreign	2,831			981			2,549
	36,975			(13,761)			25,846
Total provision (benefit) for income taxes	$	40,743		$	(13,624)		$	69,859
Effective tax rate	(35.8)		%	92.3		%	27.2		%

Schedule of Reconciliation of Tax Provision (Benefit)

A reconciliation between the calculated tax provision (benefit) based on the U.S. federal statutory rate of 21.0% and the effective tax rate for Fiscal 2023, Fiscal 2022, and Fiscal 2021 follows:


	Fiscal Years Ended
	February 3, 2024		January 28, 2023		January 29, 2022
	(in thousands)
Calculated income tax provision (benefit) at U.S. federal statutory rate	$	(23,898)	$	(3,100)	$	53,976
State and local income taxes, net of federal benefit	(6,901)		(3,812)		14,394
Foreign tax rate differential (1)	(4,937)		(5,498)		(3,598)
Non-deductible expenses	(1,488)		3,696		7,301
Excess tax detriment (benefit) related to stock compensation	558		816		(293)



Unrecognized tax benefits	3,127		(5,324)		1,050
Change in valuation allowance	68,625		163		358
Global intangible low-taxed income	9,505		1,760		1,476
Federal tax credits	(3,242)		(2,934)		(2,882)

Other	(606)		609		(1,923)
Total provision (benefit) for income taxes	$	40,743	$	(13,624)	$	69,859

____________________________________________

(1) The Company has substantial operations in Hong Kong, which has a lower statutory income tax rate as compared to the U.S. The Company’s foreign effective tax rate for Fiscal 2023, Fiscal 2022, and Fiscal 2021 was 11.6%, 9.8%, and 16.6%, respectively. This rate will fluctuate from year to year in response to changes in the mix of income by country, as well as changes in tax laws in foreign jurisdictions.

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences which give rise to deferred tax assets and liabilities were as follows:


	February 3, 2024		January 28, 2023
	(in thousands)









Deferred tax assets:
Operating lease liabilities	$	48,122	$	48,079
Capitalized research and development, net	23,653		17,856
Net operating loss carryforward	13,704		3,453
Reserves	10,167		12,038
Interest expense carryforward	9,980		1,106
Tax credits	6,630		2,727
Inventory	3,333		4,612
Tradenames and customer databases, net	3,304		—
Charitable contributions	1,084		—
Stock-based compensation	924		2,461
Subtotal	120,901		92,332
Less: valuation allowance	(69,898)		(1,273)
Total deferred tax assets	51,003		91,059
Deferred tax liabilities:
Right-of-use assets	(44,844)		(43,576)
Property and equipment, net	(3,149)		(2,407)
Prepaid expenses	(2,038)		(3,704)
Foreign and state tax on unremitted earnings	(1,554)		(1,554)
Tradenames and customer databases, net	—		(3,202)
Total deferred tax liabilities	(51,585)		(54,443)

Total deferred tax assets (liabilities), net	$	(582)	$	36,616

Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible

A reconciliation of the gross amounts of unrecognized tax benefits, excluding accrued interest and penalties, is as follows:


	Fiscal Years Ended
	February 3, 2024		January 28, 2023
	(in thousands)
Beginning Balance	$	3,626	$	8,937
Additions for current year tax positions	1,756		750
Additions for prior year tax positions	1,608		261
Reductions for prior year tax positions	—		(6,322)



Ending Balance	$	6,990	$	3,626